MYOB notes raise $150 million

Accounting software firm MYOB has increased its offer of listed notes to $150 million after receiving “strong support from brokers and institutional investors" during the book-build process.

The company originally set an official target of $125 million and the final amount raised could increase to more than $150 million once all bids have been received from the public offer.

The margin on the notes was set at the lower end of the range 670 to 690 basis points over the bank rate, however the notes will pay a 10 per cent interest for the first year of issue.

The privately owned company, which was acquired by Bain Capital from Archer in September 2011, said it will use $53.5 million to reduce its senior debt and meet its planned debt repayment schedule. The remaining funds, net of about $5.3 million of fees and expenses, will be returned to the owners of the company, along with any additional funds should the deal size be increased.

The notes will have a five-year maturity and allow holders to apply for shares of the company should it list on the Australian Securities Exchange – at a 2.5 per cent discount. Noteholders will also be entitled to an early redemption payment if the notes are bought back ahead of schedule.

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A syndicate of six banks was appointed to manage the note sale, all senior lenders to the company. They are Deutsche Bank, Morgan Stanley and UBS as joint structuring advisers and joint lead managers, alongside ANZ Securities, Macquarie Capital and Westpac Institutional Bank, which have also been assigned joint lead manager roles.

The notes are scheduled to be issued on December 20 to begin trading on the ASX on December 27.